Windstorm Insurance A Necessity for Homeowners in Storm-Prone Areas
It is important for homeowners to know what their basic homeowner's insurance policy covers and to buy additional windstorm coverage if that damage is excluded from their basic policies.

October 29, 2011 /24-7PressRelease/ -- One of the necessary expenses associated with home ownership is insurance premiums. Despite the cost, there is a certain peace of mind that comes from knowing that in the event of a catastrophic event, the costs of repair and replacement should be covered.

Many homeowners are not familiar with the fine print of their insurance policies - which is where insurance companies list various things that the policy may exclude. It is typical for insurance companies to specifically exclude coverage for certain events in a given geographical area because it may be risky for the insurance company to insure for them. For example, an unwary homeowner in Texas might be shocked to learn after a hurricane that his or her homeowner's insurance policy specifically excludes wind damage, and that he or she should have purchased an additional windstorm insurance policy.

For this reason, it is important for a homeowner to understand the limits of a homeowner's insurance policy and purchase additional coverage if necessary.

Windstorm Damage: A Common Exclusion

One of the common insurance exclusions from basic homeowner's insurance policies is damage from windstorms - especially in areas prone to hurricanes and tornadoes. As such, homeowners in those areas potentially need to purchase windstorm coverage in addition to their basic policies. These policies account for an additional premium and deductible for homeowners, on top of the costs of their basic homeowner's policies.

Because most primary insurers have dropped out of these insurance markets altogether, an entire secondary insurance pool has developed. Sometimes state governments step in to create insurance pools that act as insurers of last resort for homeowners who would not otherwise be able to find coverage. For example, after Hurricane Celia struck the Texas Gulf coast on August 3, 1970, almost all insurers stopped offering windstorm coverage in that area of the state. The Texas state government formed what is now called the Texas Windstorm Insurance Association to offer windstorm insurance to residents in the 14 counties that lie along the coast so that homeowners would not be left unable to purchase coverage.

Such state-sponsored insurance collectives operate in a similar manner to private insurance companies, in that policy holders have a written contract that details the premiums, deductibles and the limitations to the policy's coverage. As insurers of last resort, these collectives do not attempt to compete with private insurance companies in price or extent of coverage. Because they operate in high risk areas where other insurers will not, premiums can be expensive.

Those who live in areas that experience severe weather know the importance of having enough insurance in case of a disaster. It is important for homeowners to know what their basic homeowner's insurance policy covers and to buy additional windstorm coverage if that damage is excluded from their basic policies.

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